In the first day of open submissions, about 4,500 applications were received by Chicago’s new loan fund created to assist small businesses during the coronavirus pandemic.
Samir Mayekar, Chicago’s deputy mayor for economic development, told Crain’s that the Small Business Resiliency Fund drew more than $150 million in requests. He said most of the businesses that applied have just five or six employees and the average amount requested was more than $30,000.
The fund currently has $100 million in committed capital, but the city expects additional participation from wealthy donors, according to the Crain’s report.
The fund has a $25 million loss reserve in the event that loan recipients close their businesses.
There is capacity to the fund, and applications will be reviewed on a rolling first-come, first-served basis, but it’s not too late to apply for loans.
The loans – administered through lending partners, including Accion Serving Illinois & Indiana and the Community Reinvestment Fund USA – come with a five-year term, with a 1 percent interest rate for the first 18 months, followed by a 5.75 interest rate.
Checks will be sent in a matter of days in an effort to keep small businesses afloat while they await federal loans, Mayekar said.
[Crain’s] — Brianna Kelly